RBI Holds Repo Rate: 5 Banks Hike FD Rates
By ThePip Desk
Despite the RBI keeping the repo rate steady at 5.25%, five major banks have independently revised their Fixed Deposit interest rates. Discover the changes.
The Reserve Bank of India (RBI) maintained its repo rate at 5.25% for the fourth consecutive time following its Monetary Policy Committee meeting on August 5, 2026. Despite this consistent stance, five major banks have independently adjusted their Fixed Deposit (FD) rates.
RBI’s Consistent Monetary Policy
The central bank’s decision to keep the repo rate unchanged reflects its ongoing monetary policy strategy. This rate, which is the interest rate at which the RBI lends money to commercial banks, has remained stable since April 2026.
How Banks Adjust Rates Independently
Even when the RBI holds its benchmark repo rate, individual banks retain the flexibility to revise their FD rates. These adjustments are typically driven by a bank’s specific liquidity position and its goals for attracting deposits from customers.
Key Bank Fixed Deposit Rate Revisions
Several banks have implemented new FD rates, offering varied returns across different tenures. Investors should note the specific effective dates for these changes.
- Union Bank of India, effective August 4, 2026, offers 6.50% for 444 days and 6.55% for 555 days. Senior citizens receive an additional 0.50%, and super senior citizens get 0.75% more on deposits up to ₹5 crore.
- Indian Bank, with revisions effective August 7, 2026, offers 6.00% for 1 to less than 2 years on callable deposits above ₹3 crore. Deposits from 2 years up to 5 years yield 5.50%.
- CSB Bank, with revisions on August 5, 2026, provides 7.00% for 13 months and 7.10% for 18 months.
- DCB Bank’s rates, effective August 4, 2026, include its highest rate of 8.00% for a 24 to under 25-month tenure. Other competitive rates are 7.50% for 34 to under 35 months and for 60 to 61 months.
- Jana Small Finance Bank, revising rates on August 6, 2026, offers 7.00% for 271 to 366 days, 7.30% for 367 days to 2 years, and 8.00% for above 2 to 3 years.
The adjustments by these financial institutions highlight that small finance banks like Jana SFB and mid-sized private banks such as DCB are currently offering the most attractive rates, reaching up to 8%. Investors are advised to carefully compare various tenures across different banks to maximize their potential returns.